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MUMBAI: Shares of software exported Tech Mahindra surged over 7 per cent in morning trade on healthy fourth quarter results. The company reported a net profit of Rs 377 crore for quarter ended March 2013, up 36.59 per cent, as compared to a net profit of Rs 275.8 crore in corresponding last quarter.

At 09:40 a.m.; the stock was at Rs 972, up 7.1 per cent, on the BSE. It touched a high of Rs 979.85 and a low of Rs 958 in trade today.

Revenue during the fourth quarter increased to Rs 1,907 crore, up 6.47 per cent, from Rs 1,791.1 crore in previous quarter. Revenues in dollar terms rose to $ 353.2 million, up 7.35 per cent, from $ 329 million, in last quarter.

"It reported 6.5 per cent Q-o-Q growth despite challenging business outlook in the Telecom vertical driven by strong traction in the non BT clients (British Telecom clients) and full quarter integration gains from Comviva acquisition. We remain positive on the stock in view of its renewed proactive efforts to drive the revenue momentum, confident outlook, integration gains from Satyam and compelling valuations (8x FY14E earnings)," said Dolat Capital Market report.

"The revenues are likely to be driven by integration of acquired entities (HGS and Comviva) as well as strong new deal closures (closed 5 deals across geographies). We believe strong structural growth along with OPM efficiency would drive the overall metrics of the company and thus the revision in rating. We maintain our BUY recommendation on the stock with a target price of Rs 1300," the report added.

"The Management indicated that the proposed Tech Mahindra - Satyam merger had been approved by the Bombay High Court, while it awaits the Andhra Pradesh High Court approval. Management indicated that hearings at Andhra Pradesh High Court are complete and the judgment has been reserved and expects that the judgment will become available in the first two weeks of June. We continue to remain positive on the stock with Buy rating on it," said Angel Broking note.